 Pharma, bank stocks pull Wall Street lower
Reuters - 3/8/2017 8:57:23 AM
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U.S. stock prices closed lower on Tuesday as weakness in drug and financial shares sent the S&P 500 and the Dow Jones Industrial Average to their first consecutive sessions of declines in more than a month.
Pharmaceutical stocks came under pressure after U.S. President Donald Trump tweeted he was working on a "new system" to reduce drug prices in the industry, without providing details.
Trump also backed a draft bill unveiled by Republicans on Monday to repeal and replace the Obamacare healthcare law, but said the bill was open to negotiation.
The S&P 500 healthcare index .SPXHC fell 0.7 percent while the NYSE Arca pharmaceutical index .DRG declined 0.9 percent, its worst performance since Jan. 24.
"We have to always remember what (Trump) says initially always gets significantly watered down and takes significantly longer before we actually see any details," said Randy Frederick, managing director of trading and derivatives for Charles Schwab in Austin, Texas.
Financials .SPSY, the best performing S&P sector since the November election, slipped 0.3 percent, pulled lower by losses in Wells Fargo (WFC.N) and JPMorgan (JPM.N).
Investors were also preparing for the likelihood of an interest rate hike when the U.S. Federal Reserve meets next week. A number of key officials, including Chair Janet Yellen, have made comments indicating a hike is likely at its March 14-15 meeting.
That has pushed expectations for a quarter point rate increase to 84 percent, up from about 30 percent last week, according to Thomson Reuters data.
Friday's employment report could cement those expectations.
"I can’t even imagine how bad the payrolls would have to be to derail the Fed hike, so that is an almost-certainty in my mind," said Frederick.
The Dow Jones Industrial Average .DJI fell 29.58 points, or 0.14 percent, to 20,924.76, the S&P 500 .SPX lost 6.92 points, or 0.29 percent, to 2,368.39 and the Nasdaq Composite .IXIC dropped 15.25 points, or 0.26 percent, to 5,833.93.
Newly minted shares of Snapchat owner Snap Inc (SNAP.N) plunged 9.8 percent to $21.44 after analysts gave the company a lukewarm reception following its red-hot market debut, attracting short-sellers.
Nimble Storage (NMBL.N) soared 46.3 percent after Hewlett Packard Co (HPE.N) said it would buy the data storage provider for $1.09 billion in cash. HPE's stock lost 1.1 percent to $22.82.
Dish Network (DISH.O) closed up 4.5 percent at $64 after S&P Dow Jones Indices said the satellite TV company will join the S&P 500 on March 13, replacing chipmaker Linear Technology Corp (LLTC.O).
Declining issues outnumbered advancing ones on the NYSE by a 2.36-to-1 ratio; on Nasdaq, a 1.87-to-1 ratio favored decliners.
The S&P 500 posted 17 new 52-week highs and 12 new lows; the Nasdaq Composite recorded 52 new highs and 59 new lows.
About 6.44 billion shares changed hands in U.S. exchanges, below the 6.92 billion daily average over the last 20 sessions.
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